The health watchdog would still have registered failing Cumbrian hospitals as safe even if it had known there were concerns about a serious systemic fault at the trust, according to an internal review that executives apparently wanted to delete.

The Care Quality Commission posted on its website on Friday the previously suppressed report into its inspections of University Hospitals of Morecambe Bay NHS foundation trust, which is now at the centre of a police investigation after the deaths of a number of babies.

Apparently deemed so sensitive that managers wanted it to be deleted – an alleged cover-up that could result in the CQC's former chief executive losing part of her £1.4m pension pot – the report says that in April 2010 the trust was registered as fully compliant, meaning it provided adequate care, despite "minor concerns in the maternity services".

By 2011 the trust – covering hospitals in Barrow, Morecambe, Lancaster and Kendal – had the highest death rates in the country, with 250 excess deaths that year. Some months later it was warned by the NHS economic regulator Monitor and the CQC for failing to meet essential safety standards, including on patient welfare.

However the CQC review, rather than blaming its inspection staff for missing such widespread failure, instead attacks the hospital trust's "secretive culture" for telling "the CQC what they think they want to hear in order to keep [it] closed to external independent scrutiny".

The report says that with the benefit of hindsight there were possible indications "that may have triggered a 'deep dive' [investigation]".

Brian Jarman, a professor at Imperial College London who co-founded the health statistics and research service Doctor Foster, told the Guardian he had warned the trust over higher than average mortality rates for septicaemia in early 2010.

"They never took any notice. I told the CQC as well but back then people did not worry about such things. They rather looked away when confronted with the data," he said.

Jarman said he met Paul Bate, a former Downing Street adviser who is now director of strategy at the CQC, on Friday to discuss how death rate data could help.

"I think [the CQC] have completely changed their tune and are genuinely intending to use mortality data. It's 12 years too late, perhaps."

Earlier the health secretary, Jeremy Hunt, described the CQC's suppression of the report as "utterly shocking", and said the way the regulator had been set up in 2009 was "a big mistake".

He said the CQC would get £40m to ensure that it had expert inspectors who could produce Ofsted-style reports about hospital standards.

Cynthia Bower, a former chief executive of the CQC, and her then deputy, Jill Finney, were named on Thursday as having been present during a discussion of the deletion of the internal review, along with media manager Anna Jefferson, who is still at the regulator though currently on maternity leave. All three deny being involved in a cover-up.

Jefferson released a statement saying she and the two other women thought the report was "not fit for purpose".

The CQC's current chief executive, David Behan, and the chairman, David Prior, are to be summoned to appear before the parliamentary health select committee. The committee's chairman, Stephen Dorrell, a Tory former health secretary, said he had asked for them to be given an "early opportunity" to give evidence.

In a speech on Friday, Hunt warned about the "silent scandal of patient safety" in the NHS, in which he said 3,000 patients a year died because of lapses in safety.

"In the wake of Mid Staffs, Morecambe Bay and many other shocking lapses in care, we must ask ourselves whether we, along with other countries, have become so numbed to the inevitability of patient harm that we accept the unacceptable," he said.

James Titcombe, whose nine-day-old son Joshua died at Furness general hospital in 2008, called for the police to interview former CQC executives. "We need to get to the bottom of this as soon as possible," he said.

Police requested an interview with Bower and two other officials during an investigation into the baby's death but were told they had no "direct day-to-day" involvement in the case and that statements from them would "not add any value".